It seems as if the popular take among tech pundits in light of Sunday's announcement of the AT&T and T-Mobile merger is that it is a bad situation for everyone involved. Among the reasons I've seen so far are a further consolidation of an already top-heavy industry, the threat of rising prices as a result of less alternatives, and a loss of one of Android's most stalwart partners.
But let's step back a minute from the insta-reactions of most of the tech world and look at the bottom line: merger or not, T-Mobile's customers stand to benefit the most by far. The deal is written in such a way that even if regulators scoff at it, T-Mobile will exit in a much stronger position than it is currently in.
I do realize that hyper-consolidation in any industry is never good. The SprinT-Mobile merger that looked like a possibility a few weeks ago would have been the merger from hell, though. Yes, it would have likely won easy approval because the combined company would still have less customers than its two larger competitors. But merging those two networks would have taken years.
When Cingular and AT&T Wireless merged in 2004, it took the two companies nearly two years to merge the GSM and TDMA networks together (the old AT&T Wireless had already begun the process, however). The two technologies were fairly similar: an upgrade path was available from TDMA to GSM.
With CDMA, Sprint's wireless technology, there is not. It would require a massive and costly transition that would likely take much longer.
T-Mobile did not have that kind of time. It could be argued the company was following a similar path to Sprint previous to the Nextel merger, where the company was drifting, listless, and beginning to hemorrhage customers. T-Mobile needed to figure out its future. AT&T was it.
While AT&T talked up the benefits to its own subscribers in the merger announcement, the real winners are the T-Mobile customers. With identical technologies (save for their 3G frequencies), almost immediately after the merger is approved those subscriber's coverage area will increase several times over. (For T-Mobile subscribers, the biggest gripe is always coverage.)
Secondly, T-Mobile customers will stand to benefit from gaining access to AT&T's expansive non-Android line (iPhone/iPad, Windows Phone 7). I honestly do not believe that AT&T would not beef its Android lineup as a result of this marriage: remember, a Deutsche Telekom executive will now sit on the AT&T board.
Third, T-Mobile customers now have a clear path to LTE. The carrier has been pretty silent, talking up its HSPA+ network, but has so far not made a strong commitment to the 4G technology. Remember how far the carrier was behind on 3G - in this increasingly data intensive society, it can't afford to continue to play catch up.
Fourth, and probably the most important, is what happens if the merger fails. T-Mobile would get $3 billion in cash from AT&T as a result, as well as unused AWS spectrum. Add to this the fact that AT&T is required to provide the carrier a roaming agreement "on terms favorable to T-Mobile," and how could customers lose?
I think it's foolish to believe that T-Mobile would be able to continue life as a budget-priced carrier while still attempting to compete on the stage with the big boys. It was simply not going to happen. The AT&T deal was the smartest move for the carrier, even if it seemed the least likely. We shouldn't automatically assume the worst-if our antitrust regulators do their jobs, we won't need to worry about the return of Ma Bell anytime soon.
This story, "AT&T-Mobile Is a Win for T-Mobile’s Customers" was originally published by Technologizer.